/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/230329.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Wednesday, March 29, 2023, Vol. 24, No. 64 Headlines F R A N C E CONSTELLIUM SE: S&P Alters Outlook to Positive, Affirms 'B+' ICR I R E L A N D ICG EURO 2023-1: S&P Assigns B- (sf) Rating to Class F Notes INVESCO EURO IX: Fitch Assigns 'B-sf' Final Rating on Class F Notes PERRIGO CO: S&P Affirms 'BB' Issuer Credit Rating, Outlook Stable PRE 15 LOAN: Fitch Assigns 'BB-sf' Final Rating on Class D Notes I T A L Y EPIZZA SPA: Milan Judge Opens Liquidation Proceedings SUNRISE SPV 40: Fitch Assigns 'BB+sf' Final Rating on Class E Notes S P A I N TDA 26-MIXTO 1: Fitch Affirms 'CCCsf' Rating on Class 1-D Notes U N I T E D K I N G D O M AUTOVOGUE: Enters Liquidation, Owes Creditors GBP1.4 Million BRIAN CLEGG: Owed GBP4 Million at Time of Administration CINEWORLD GROUP: CVC, Elliot Table Bid for Part of Business FLYBE GROUP: Collapse Hits Cyrus Capital Hedge Fund SWADDLE MICRO: Enters Administration, Buyers Sought for Business - - - - - =========== F R A N C E =========== CONSTELLIUM SE: S&P Alters Outlook to Positive, Affirms 'B+' ICR ---------------------------------------------------------------- S&P Global Ratings revised its outlook on Constellium SE to positive from stable and affirmed the 'B+' long-term issuer credit and issue ratings on the company and its senior unsecured debt. The positive outlook reflects the possibility of an upgrade in the next nine-to-12 months if the company meets our base case. The outlook revision is supported by Constellium's deleveraging journey In the past three years, the company reduced its adjusted debt to EUR2.7 billion from EUR3.3 billion, which, together with stronger EBITDA, led to improved adjusted debt to EBITDA of 4.0x at year-end 2022 from 6.3x at year end 2020. S&P views the current ratio as another checkpoint toward an adjusted debt to EBITDA of 3x-4x by 2024, a level that will support a 'BB-' rating. S&P said, "The company's 2022 results met our expectations, and we continue to foresee favorable demand for its products in the coming 24 months, despite volatility. Constellium finished 2022 with S&P Global Ratings-adjusted EBITDA increasing close to 20% year on year to EUR670 million. This was mainly explained by robust demand in aerospace and transportation (20% of the company's revenue), a favorable product mix, and improved pricing mitigating most inflationary pressures. Looking ahead, we expect the auto recovery to bolster EBITDA while other segments should expand only modestly due to the close-to-recession environment in Europe and the U.S. Although long-term trends remain favorable, the pace of EBITDA expansion is still uncertain in 2023-2024. Constellium's financial policy remains an important pillar of the rating. The company aims to reduce its reported net debt to EBITDA to at least 2.5x (corresponding to S&P Global Ratings-adjusted debt to EBITDA of 3.75x), with a longer-term target of maintaining 1.5x-2.5x. This will correspond to a 'BB-' rating. Under its base case, S&P believes it can meet this target by December 2024. The global shift toward a more sustainable, greener, world will continue to support demand for Constellium's products. S&P said, "In our view, aluminum products will continue to penetrate additional applications in the coming years. We believe the company's portfolio--focusing on products such as beverage cans and structures for planes and autos--and its geographical footprint put it in an excellent position to meet the global sustainable transition, providing long-term growth prospects. This is reinforced by the company's use of secondary aluminum, which requires less energy and has lower carbon dioxide emissions than primary aluminum. In our view, the main growth market will remain the auto industry, with annual expansion of about 4%-6% in the next few years, while the packaging business will continue to expand more slowly while providing very solid base-line demand. Several opportunities could propel the company's growth including the need for safety, electric vehicles, or light-weighting." The positive outlook reflects the possibility of an upgrade within nine-to-12 months if the company meets our base case. S&P believes that Constellium's long-term contracts will provide some protection against a potentially unfavorable macroeconomic environment. The outlook also reflects the company's potential to continue its deleveraging journey in the next 12-18 months such that its adjusted leverage moves sustainably below 4x, depending on market conditions. S&P said, "Under our revised base-case scenario, we expect Constellium to report S&P Global Ratings-adjusted EBITDA of EUR650 million-EUR700 million in 2023, translating into adjusted debt to EBITDA of 3.5x-4.0x. This compares with the 3.0x-4.0x that is commensurate with a 'BB-' rating. In our view, if the company doesn't reach 4.0x (or below) in 2023, it will in 2024. "We could raise the rating on Constellium by one notch in the coming nine-to-12 months if we get better visibility on its profitability and free cash flows in 2023 and 2024, supporting a reduction in adjusted debt to EBITDA to below 4.0x sustainably." S&P could revise the outlook to stable in the coming 12-18 months if: -- A harsh macroeconomic environment leads to much lower demand and a spike in raw materials costs without the ability to pass them on to customers. -- The company makes a major acquisition. ESG Credit Indicators: E-2, S-2, G-2 ============= I R E L A N D ============= ICG EURO 2023-1: S&P Assigns B- (sf) Rating to Class F Notes ------------------------------------------------------------ S&P Global Ratings assigned its credit ratings to ICG Euro CLO 2023-1 DAC's class A, B, C, D, E, and F notes. At closing, the issuer also issued EUR28.10 million of unrated class Z and subordinated notes. Under the transaction documents, the rated notes pay quarterly interest unless a frequency switch event occurs. Following this, the notes will switch to semiannual payments. The portfolio's reinvestment period will end approximately 4.56 years after closing. S&P said, "We performed our analysis on the portfolio provided to us by the manager. We consider that on the effective date, the portfolio will be well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans. Therefore, we have conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs." Portfolio Benchmarks S&P Global Ratings weighted-average rating factor 2,899.49 Default rate dispersion 428.25 Weighted-average life (years) 4.56 Obligor diversity measure 87.82 Industry diversity measure 19.32 Regional diversity measure 1.26 Weighted-average rating B 'CCC' category rated assets (%) 1.57 'AAA' weighted-average recovery rate 36.37 Floating-rate assets (%) 92.90 Weighted-average spread (net of floors; %) 4.20 S&P said, "In our cash flow analysis, we used the EUR400 million target par amount, a weighted-average spread of 4.20%, and the covenanted portfolio's weighted-average recovery rates. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B to E notes could withstand stresses commensurate with higher ratings than those we have assigned. However, the CLO benefits from a reinvestment period until Oct. 19, 2027, during which the transaction's credit risk profile could deteriorate, subject to CDO monitor results. We have therefore capped our ratings assigned to the notes. "Elavon Financial Services DAC is the bank account provider and custodian. The account bank and custodian's documented replacement provisions are in line with our counterparty criteria for liabilities rated up to 'AAA'. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "We consider the issuer to be bankruptcy remote, in accordance with our legal criteria. "The CLO is managed by Intermediate Capital Managers Ltd. Under our "Global Framework For Assessing Operational Risk In Structured Finance Transactions," published on Oct. 9, 2014, the maximum potential rating on the liabilities is 'AAA'. "In addition to our standard analysis, to provide an indication of how rising pressures among speculative-grade corporates could affect our ratings on European CLO transactions, we have also included the sensitivity of the ratings on the class A to E notes to four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance (ESG) S&P said, "We regard the exposure to ESG credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average." For this transaction, the documents prohibit assets from being related to certain activities, including, but not limited to the following: -- Weapons of mass destruction, including radiological, nuclear, biological and chemical weapons; -- Tobacco production such as cigars, cigarettes, e-cigarettes, smokeless tobacco, dissolvable and chewing tobacco or any obligor that is classified as "tobacco"; -- Predatory or payday lending; -- Pornographic materials or content, or prostitution-related activities; -- Trading in endangered or protected wildlife; -- Trading of illegal drugs or narcotics; -- Any obligor that is an electrical utility where carbon intensity is greater than 100g CO2/kWh; -- Any obligor that derives more than 50% of its revenue from the trade in hazardous chemicals, pesticides, waste, or ozone-depleting substances; -- Any obligor where more than 10% of its revenue is derived from weapons, tailormade components, or civilian firearms; -- Any obligor that generates more than 1% of revenues from thermal coal or coal based power generation, oil sands, or fossil fuels from unconventional sources; or -- Any obligor that is an oil and gas producer that derives less than 40% of its revenue from natural gas or renewables, or that has reserves of less than 20% deriving from natural gas. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities. Environmental, social, and governance (ESG) corporate credit indicators S&Ps aid, "The influence of ESG factors in our credit rating analysis of European CLOs primarily depends on the influence of ESG factors in our analysis of the underlying corporate obligors. To provide additional disclosure and transparency of the influence of ESG factors for the CLO asset portfolio in aggregate, we've calculated the weighted-average and distributions of our ESG credit indicators for the underlying obligors. We regard this transaction's exposure as being broadly in line with our benchmark for the sector, with the environmental and social credit indicators concentrated primarily in category 2 (neutral) and the governance credit indicators concentrated in category 3 (moderately negative)." Corporate ESG Credit Indicators ENVIRONMENTAL SOCIAL GOVERNANCE Weighted-average credit indicator* 2.07 2.14 2.96 E-1/S-1/G-1 distribution (%) 1.36 0.00 0.00 E-2/S-2/G-2 distribution (%) 77.58 77.73 10.09 E-3/S-3/G-3 distribution (%) 7.24 5.19 72.14 E-4/S-4/G-4 distribution (%) 0.00 3.25 1.45 E-5/S-5/G-5 distribution (%) 0.00 0.00 2.50 Unmatched obligor (%) 6.09 6.09 6.09 Unidentified asset (%) 7.73 7.73 7.73 *Only includes matched obligor. Ratings List CLASS RATING AMOUNT INTEREST RATE SUB (%) (MIL. EUR) A AAA (sf) 236.00 3mE + 1.75% 41.00 B AA (sf) 49.20 3mE + 3.25% 28.70 C A (sf) 20.80 3mE + 4.40% 23.50 D BBB- (sf) 26.80 3mE + 6.15% 16.80 E BB- (sf) 18.80 3mE + 7.72% 12.10 F B- (sf) 13.20 3mE + 10.90% 8.80 Z NR 1.00 N/A N/A Sub notes NR 27.10 N/A N/A EURIBOR--Euro Interbank Offered Rate. 3mE--Three-month EURIBOR. NR--Not rated. N/A--Not applicable. INVESCO EURO IX: Fitch Assigns 'B-sf' Final Rating on Class F Notes ------------------------------------------------------------------- Fitch Ratings has assigned Invesco Euro CLO IX DAC final ratings, as detailed below. Entity/Debt Rating ----------- ------ Invesco Euro CLO IX DAC A Loan LT AAAsf New Rating A Notes XS2496643243 LT AAAsf New Rating B XS2496643599 LT AAsf New Rating C XS2496643912 LT Asf New Rating D XS2496644050 LT BBB-sf New Rating E XS2496644480 LT BB-sf New Rating F XS2496644563 LT B-sf New Rating Sub Notes XS2496644647 LT NRsf New Rating TRANSACTION SUMMARY Invesco Euro CLO IX DAC is a securitisation of mainly senior secured obligations (at least 90%) with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. The note proceeds will be used to fund a portfolio with a target par of EUR400 million that is actively managed by Invesco CLO Equity Fund IV LP. The CLO has a 4.6-year reinvestment period and an 8.5-year weighted average life (WAL) test. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'/'B-'. The Fitch weighted average rating factor of the identified portfolio is 24.67. High Recovery Expectations (Positive): At least 90% of the portfolio will comprise senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate of the identified portfolio is 62.81%. Diversified Portfolio (Positive): The transaction has two matrices effective at closing corresponding to the 10 largest obligors at 25% of the portfolio balance and two fixed-rate asset limits at 7.50% and 13.75% of the portfolio. There are also two forward matrices corresponding to the same top 10 obligors and fixed-rate assets limits that will be effective one year after closing, provided that the collateral principal amount (defaults at Fitch-calculated collateral value) is at least at the reinvestment target par balance. The transaction also includes various concentration limits, including exposure to the three-largest Fitch-defined industries in the portfolio at 42.5%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction has reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash-flow Modelling (Neutral): The WAL used for the stressed-case portfolio is 12 months less than the WAL covenant to account for structural and reinvestment conditions after the reinvestment period, including the satisfaction of the over-collateralisation test and Fitch 'CCC' limit, together with a linearly decreasing WAL covenant. In Fitch's opinion, these conditions would reduce the effective risk horizon of the portfolio during stress periods. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: A 25% increase of the mean default rate (RDR) across all ratings and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class A, B, C and D notes, and would lead to downgrades of one notch for the class E notes and to below 'B-sf' for the class F notes. Based on the identified portfolio downgrades may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than Fitch-stressed portfolio, the class F notes display a rating cushion of three notches, the class B, D and E notes two notches, and the class C notes one notch. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of up to four notches for the rated notes. Factors that could, individually or collectively, lead to positive rating action/upgrade: A 25% reduction of the mean RDR across all ratings and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to five notches for the rated notes, except for the 'AAAsf' rated notes, which are at the highest level on Fitch's scale and cannot be upgraded. During the reinvestment period, upgrades based on the Fitch-stressed portfolio, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, leading to the ability of the notes to withstand larger than expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades may occur in case of stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover for losses in the remaining portfolio. DATA ADEQUACY The majority of the underlying assets or risk presenting entities have ratings or credit opinions from Fitch and/or other Nationally Recognized Statistical Rating Organizations and/or European Securities and Markets Authority registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. PERRIGO CO: S&P Affirms 'BB' Issuer Credit Rating, Outlook Stable ----------------------------------------------------------------- S&P Global Ratings affirmed its 'BB' issuer credit on Perrigo Co. PLC and affirmed its 'BB+' rating on the senior secured debt and 'BB-' rating on the senior unsecured debt. The recovery rating on the senior secured debt remains '2', indicating that lenders could expect substantial (70%-90%; rounded estimate: 85%) recovery in the event of a payment default. The recovery rating on the senior unsecured notes remains '5', indicating that noteholders could expect modest (10%-30%; rounded estimate: 20%) recovery in the event of a payment default. The stable outlook reflects S&P's expectation that Perrigo will reduce S&P Global Ratings-adjusted leverage to slightly below 5x over the next year with further improvement to the low-4x area in 2024. S&P said, "We expect credit ratio improvement to begin in 2023 despite Perrigo missing our expectations for 2022. We believe the company should gain traction in 2023 due to carryover pricing, better supply chain conditions, and completing the integration of the higher-gross margin HRA business. Moreover, the Gateway infant formula acquisition in the fourth quarter of 2022 should add volumes and alleviate inefficiencies at Perrigo's aging Vermont nutrition plant. We also believe the organization should benefit from the absence of significant portfolio reconfiguration actions which occurred over the last four years and were aimed at transforming Perrigo into a pure-play consumer self-care company; these actions involved seven small to medium-sized acquisitions, four disposals, and the closure of an R&D facility. Perrigo management has made clear its intention to de-lever the balance sheet by growing profits and repaying debt such that company-defined leverage improves to around 3x by 2025 from 5.5x currently. We expect no acquisitions or share repurchases until Perrigo materially improves credit metrics. Moreover, we assume the net cash proceeds from the sale of any remaining noncore assets (should such disposals occur) will be earmarked for debt repayment." Perrigo did not deleverage as S&P expected in 2022, ending the year at about 5.5x, roughly unchanged from the beginning of the year. The inability to de-lever the balance sheet resulted primarily from ongoing macro supply chain challenges, high inflation which, for the store brand business, is harder to pass along and occurs with up to a six-month lag, and unfavorable currency translation mainly in Perrigo's sizable European business. A host of macro-challenges, including those noted above, negatively affected operating profit by $410 million since 2019. The Supply Chain Reinvention Program (SCRP) could enhance efficiencies though will require meaningful expenditures. One of the core components to Perrigo's plan to expand its adjusted gross margin 400 basis points by 2025 is its SCRP. This entails several aspects including simplifying the portfolio by reducing complexity (cutting the non-value-added variation on substantially identical product that exists in its portfolio). Other key aspects include improving forecast error to fulfill sales and reduce waste, optimizing production (including allocating more business to fewer co-manufactures in certain segments that currently use too many partners and insourcing manufacturing in other businesses), and upgrading the manufacturing base partly through automation and standardizing processes. While the SCRP extends to 2028, most of the program expenditures and benefits should be realized by 2025, including $150 million to $200 million run-rate savings and $300 million to $450 million expenditures (the latter of which will be split between expenses and capital expenditures/investments including the $110 million already spent on the Gateway acquisition). S&P said, "We believe the SCRP makes sense given the completion of Perrigo's multiyear business repositioning, management's disclosure of excess-SKU proliferation mainly in the store brand business, and the desire to improve productivity. However, the costs are sizable, and Perrigo's capex will increase meaningfully ($500 million to $600 million cumulative total capex from 2023 to 2025) partly for SCRP but also asset reliability initiatives. We also believe there is risk to retailers accepting reduced consumer choice and possibly lower volumes of store brand products that Perrigo provides." Category dynamics are broadly favorable, though competition may increase and unique risks exist. S&P believes the over-the-counter consumer health category in general and store brand offerings specifically should fare relatively well in an economic downturn. In addition, aging populations and a desire for health and wellness should translate into low-single-digit category volume growth across Perrigo's segments. Additional growth areas including women's health and generic prescription to store-brand OTC switches could also expand Perrigo's product portfolio. Moreover, consumer health store brand products, which typically experience low cyclicality, should benefit from consumer trade down if economic conditions weaken or inflation remains high. S&P said, "That said, we continue to believe additional store-brand price increases (which are not incorporated into our 2023 forecast) will need to be cost-justified prior to acceptance by Perrigo's large retail customers, which have--under low inflation environments--historically sought price reductions. Moreover, several newly formed, pure-play branded consumer health rivals--including Haleon PLC and Kenvue Inc.--could pressure Perrigo if they become more innovative or price focused. In addition, while the successful consolidation of HRA (including transition from third-party distributors to Perrigo's inhouse sales force) should strengthen profitability, many of Perrigo's legacy European brands possess modest market shares and limited economies of scale due to operating in numerous countries. Moreover, there is currency risk which could be exacerbated by geopolitical developments, such as the Ukraine conflict and the continent's energy policy. Lastly, Perrigo is subject to $417 million of liabilities for uncertain tax positions, as well as industrywide product liability and generic prescription price-fixing allegation. Despite these risk factors, in our view material downside over the next 12 to 18 months is limited. "The stable outlook reflects our expectation that Perrigo will reduce adjusted leverage to slightly below 5x over the next year with further improvement to the low-4x area in 2024 as inflation and supply chain disruptions ease, despite Perrigo spending significantly on its Supply Chain Reinvention Program." S&P could lower the rating over the next few quarters if it forecasts that Perrigo will not reduce adjusted leverage below 5x by the end of 2023, potentially due to: -- Escalating competition from branded rivals including newly formed, pure-play consumer health companies that have or are in process of separating from their pharmaceutical parent. -- Demands from retailers to meaningfully reduce pricing on Perrigo's store brand products. -- An inability to offset renewed currency, inflation, or labor headwinds. -- Disruptions arise implementing the Supply Chain Reinvention Program, including retailer resistance, operational missteps, or higher than planned expenditures. -- Unfavorable resolutions to various uncertain tax positions, which aggregate about $417 million including interest and penalties, and industrywide litigation. While unlikely over the next year, S&P could raise the rating if it believes Perrigo will: -- Sustain S&P Global Ratings-adjusted debt to EBITDA in the 3x-4x range, including after incorporating its medium-term acquisition strategy and resolution of contingencies from outstanding tax litigation. -- Successfully implement its Supply Chain Reinvention Program which will require meaningful expenditures and a large reduction in the number of SKUs. ESG credit indicators: E-2, S-2, G-2 S&P said, "ESG factors are an overall neutral consideration in our credit rating analysis of Perrigo. While the company has been and remains subject to several tax disputes, these arose primarily under prior management. Moreover, Perrigo settled with the Irish tax authority for EUR297 million pertaining to the tax rate applicable to the sale of, and subsequent royalties generated from, Tysabri, which the company disposed of in 2017. We do not view Perrigo's product liability as particularly onerous relative to other health care issuers, and note the company's sale of its generic prescription business, which may reduce risk going forward. Regarding environmental factors, we also believe the company is not significantly more exposed than its consumer goods peers to the potential unsustainability of some of its packaging." PRE 15 LOAN: Fitch Assigns 'BB-sf' Final Rating on Class D Notes ---------------------------------------------------------------- Fitch Ratings has assigned RRE 15 Loan Management Designated Activity Company final ratings as detailed below. Entity/Debt Rating ----------- ------ RRE 15 Loan Management DAC A-1 XS2591162016 LT AAAsf New Rating A-2A XS2591162107 LT AAsf New Rating A-2B XS2591162362 LT AAsf New Rating B-1 XS2591162792 LT NRsf New Rating B-2 XS2591162958 LT NRsf New Rating C XS2591162875 LT NRsf New Rating D XS2591163337 LT BB-sf New Rating Performance Notes XS2591163501 LT NRsf New Rating Preferred Return Notes XS2591163410 LT NRsf New Rating Subordinated XS2591163840 LT NRsf New Rating TRANSACTION SUMMARY RRE 15 Loan Management Designated Activity Company is a securitisation of mainly senior secured obligations with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds were used to purchase a portfolio with a target par of EUR400 million. The portfolio is actively managed by Redding Ridge Asset Management (UK) LLP. The collateralised loan obligation (CLO) has a 4.6 reinvestment period and an 8.5-year weighted average life test (WAL test). KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'/'B-'. The Fitch weighted average rating factor (WARF) of the identified portfolio is 25.52. High Recovery Expectations (Positive): At least 95% of the portfolio will comprise senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate (WARR) of the identified portfolio is 61.88%. Diversified Asset Portfolio (Positive): The transaction includes three Fitch matrices corresponding to an 8.5-year WAL, a 7.5-year WAL, and a 6.5-year WAL. All the matrices are based on a top-10 obligor concentration limit at 20% and a fixed-rate asset limit of 10%. The manager can select the 7.5-year and 6.5-year WAL matrices at any time starting from one and two years, respectively, after closing as long as the portfolio balance (including defaulted obligations at their Fitch-calculated collateral value) is above EUR400 million (for the 7.5-year and eight-year matrices) and EUR398 million (for the seven-year matrix). The transaction includes various concentration limits in the portfolio, including the top-10 obligor concentration limit at 20% and the maximum exposure to the three-largest Fitch-defined industries in the portfolio at 40%. These covenants ensure the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction has a 4.6-year reinvestment period and reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash Flow Modelling (Positive): The WAL covenant for the transaction's stressed-case portfolio and matrices analysis is 12 months less than the WAL covenant (floored at six years) to account for structural and reinvestment conditions after the reinvestment period, including the satisfaction of the over-collateralisation (OC) tests and Fitch 'CCC' limit, together with a consistently decreasing WAL covenant. These conditions would in the agency's opinion reduce the effective risk horizon of the portfolio during stress period. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: A 25% increase of the mean default rate (RDR) across all ratings and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class A-1 notes and would lead to downgrades of no more than one notch for the class A-2 and D notes. Based on the identified portfolio, downgrades may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the class A-2 and D notes display a rating cushion of two notches. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR across all ratings and a 25% decrease of the RRR across all ratings of the stressed portfolio would lead to downgrades of up to four notches for the rated notes. Factors that could, individually or collectively, lead to positive rating action/upgrade: A 25% reduction of the mean RDR across all ratings and a 25% increase in the RRR across all ratings of Fitch-stressed portfolio would lead to upgrades of up to two notches for the rated notes, except for the 'AAAsf' rated notes. During the reinvestment period, based on Fitch-stressed portfolio, upgrades, except for the 'AAAsf' notes, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, allowing the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades, except for the 'AAAsf' notes, may occur on stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. DATA ADEQUACY The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ========= I T A L Y ========= EPIZZA SPA: Milan Judge Opens Liquidation Proceedings ----------------------------------------------------- Giulia Morpurgo at Bloomberg News reports that Domino's Pizza Inc.'s franchise in Italy has entered into liquidation, after a short-lived struggle to win over customers in the birthplace of pizza. A Milan-based judge opened liquidation proceedings for Domino's franchise partner, ePizza SpA, according to a filing with the local chamber of commerce seen by Bloomberg News. A court-ordered liquidation could result in a recovery for creditors of 5% of their exposure, according to a draft restructuring plan seen by Bloomberg News that was submitted last year by the Milan-based firm and its financial advisors. The last of Domino's 29 Italian branches closed last summer, ending a foray that began in 2015 with the US brand touting pizza toppings that included pineapple and barbecue chicken, an unusual take in a country more accustomed to thin-crust margheritas, Bloomberg News recounts. Over the years, the American fast-food chain's partner borrowed heavily for ambitious plans to open 880 stores, Bloomberg News notes. The pandemic, however, hobbled ePizza. Covid-related lockdowns deprived the company of 35% of its revenues from 2020, as did rising competition, Bloomberg News states. All those challenges led ePizza to fall behind on its debt payments, with talks on a potential rescue failing to bear fruit, Bloomberg News discloses. As of May 2022, it had EUR19.3 million (US$20.8 million) of debt, of which EUR5.3 million were owed to banks, Bloomberg News relays, citing the draft restructuring plan. The Milan tribunal has set a hearing on ePizza's liquidation for June 21, according to the first filing, Bloomberg News notes. SUNRISE SPV 40: Fitch Assigns 'BB+sf' Final Rating on Class E Notes ------------------------------------------------------------------- Fitch Ratings has assigned Sunrise SPV 40 S.r.l. - Series 2023-1's asset-backed securities final ratings, as detailed below. Entity/Debt Rating ----------- ------ Sunrise SPV 40 S.r.l. - Series 2023-1 Class A IT0005538985 LT AAsf New Rating Class B IT0005538993 LT Asf New Rating Class C IT0005539009 LT BBB+sf New Rating Class D IT0005539017 LT BBB-sf New Rating Class E IT0005539025 LT BB+sf New Rating Class M IT0005539033 LT NRsf New Rating TRANSACTION SUMMARY The transaction is a 12-month revolving securitisation of unsecured consumer loans granted to private customers by Agos Ducato S.p.A. (Agos, A-/Stable/F1). This is the 23rd public securitisation of unsecured consumer loans originated by Agos. The proceeds of the euro-denominated notes have been used to fund the purchase of a portfolio of personal loans and loans that funded the purchase of vehicles, furniture or other goods. Part of the proceeds has been used to fund a cash reserve and a liquidity reserve. The notes amortise sequentially and pay a fixed interest rate. KEY RATING DRIVERS Sound Performance: Fitch expects a weighted average (WA) lifetime default rate of 5.6% and a WA recovery rate of 10.3% for a stressed portfolio composition at the end of the transaction's revolving period. The assumptions take into account the resilience of Agos' loan book as shown in the historical vintages provided by the originator and the solid performance of other Sunrise transactions, with limited deterioration during periods of economic stress. Fitch's base-case assumptions also take into account the agency's forward-looking view of potential moderate performance deterioration. Mainly Unsecured Personal Loans: At closing, 75.4% of the portfolio consists of personal loans (limited to 80% by the transaction's documentation through the revolving period), which have experienced greater historical loss rates than other types of consumer loans. The remainder of the portfolio is composed of auto loans, furniture and finalised loans. Revolving Period Risk Addressed: Fitch has applied a WA default stress multiple of 4.5x at 'AAsf' to the expected default rates to reflect possible portfolio deterioration during the 12-month revolving period. The agency believes that some of the revolving conditions are loose and has addressed the risk of performance deterioration via the default stress multiple. High Excess Spread: During the revolving period the transaction will benefit from a minimum portfolio yield of 7%. This contributes to an increase of the cash reserve towards its target of 2.5% of the current portfolio balance excluding defaulted loans (from 0.5% of the initial portfolio funded at closing). Sovereign Cap: The rating of the class A notes is limited to 'AAsf' by the cap on Italian structured finance transactions of six notches above the rating of Italy (BBB/Stable/F2). The Stable Outlook on the notes' rating also reflects the Outlook on Italy's Issuer Default Rating (IDR). RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: The class A notes are sensitive to changes in Italy's Long-Term IDR. A downgrade of Italy's IDR and a downward revision of the 'AAsf' rating cap for Italian structured finance transactions would trigger downgrades of the notes rated at this level. An unexpected increase in the frequency of defaults or decrease of the recovery rates could produce larger losses than the base case. For example, a simultaneous increase of the default base case by 25% and a decrease of the recovery base case by 25% would lead to downgrades of up to three notches on the class A to E notes. Factors that could, individually or collectively, lead to positive rating action/upgrade: Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade: The class A notes are sensitive to changes in Italy's Long-Term IDR. An upgrade of Italy's IDR and an upward revision of the 'AAsf' rating cap for Italian structured finance transactions could trigger upgrades of the notes rated at this level, provided sufficient credit enhancement is available to withstand stresses at higher ratings. An unexpected decrease of the frequency of defaults or increase of the recovery rates could produce smaller losses lower than the base case. For example, a simultaneous decrease of the default base case by 25% and an increase of the recovery base case by 25% would lead to upgrades of up to three notches on the class B to E notes. DATA ADEQUACY Fitch reviewed the results of a third-party assessment conducted on the asset portfolio information, and concluded that there were no findings that affected the rating analysis. Fitch conducted a review of a small targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG CONSIDERATIONS Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. ========= S P A I N ========= TDA 26-MIXTO 1: Fitch Affirms 'CCCsf' Rating on Class 1-D Notes --------------------------------------------------------------- Fitch Ratings has upgraded Bankinter 9, FTA - Series P (Bankinter 9P) class B notes' rating to 'AAAsf' from 'AA-sf' and affirmed the rest. It has also affirmed all tranches of Bankinter 9, FTA - Series T (Bankinter 9T), TDA 26-Mixto, FTA - Series 1 (TDA 26-1) and TDA 26-Mixto, FTA - Series 2 (TDA 26-2). The Outlooks are Stable. Entity/Debt Rating Prior ----------- ------ ----- TDA 26-Mixto, FTA - Series 1 Class 1-A2 ES0377953015 LT AAAsf Affirmed AAAsf Class 1-B ES0377953023 LT AAAsf Affirmed AAAsf Class 1-C ES0377953031 LT Asf Affirmed Asf Class 1-D ES0377953049 LT CCCsf Affirmed CCCsf Bankinter 9, FTA - Series P Series P Class A2 ES0313814016 LT AAAsf Affirmed AAAsf Series P Class B ES0313814024 LT AAAsf Upgrade AA-sf Series P Class C ES0313814032 LT Asf Affirmed Asf Bankinter 9, FTA - Series T Series T Class A2 ES0313814057 LT AAAsf Affirmed AAAsf Series T Class B ES0313814065 LT AAAsf Affirmed AAAsf Series T Class C ES0313814073 LT Asf Affirmed Asf TDA 26-Mixto, FTA - Series 2 Class 2-A ES0377953056 LT A+sf Affirmed A+sf Class 2-B ES0377953064 LT Asf Affirmed Asf Class 2-C ES0377953072 LT CCCsf Affirmed CCCsf TRANSACTION SUMMARY The transactions comprise fully amortising Spanish residential mortgages originated and serviced by Banco de Sabadell, S.A. (BBB-/Stable/F3), Banca March S.A. and Bankinter, S.A. KEY RATING DRIVERS Mild Asset Performance Deterioration: The rating actions reflect its expectation of mild deterioration of asset performance, consistent with a weaker macroeconomic outlook linked to inflationary pressures that negatively affect real household wages and disposable income, while recognising the low share of loans in arrears over 90 days (less than 0.6% as of the latest reporting date) and the protection by substantial seasoning of the portfolios of more than 17 years. However, Fitch sees some portfolio risk attributes that could accelerate the deterioration of the assets' performance. For TDA 26-1 and TDA 26-2, the securitised portfolios are exposed to geographical concentration in the regions of Balearic Islands and Canary Islands. Despite a material exposure to self-employed borrowers in Bankinter 9P (around 20% of the current performance balance), Bankinter 9T and TDA 26-2 the weighted average (WA) original loan-to-value (OLTV) is around 90%. Excessive Counterparty Exposure: TDA 26-1's class C notes, TDA 26-2's class B notes, Bankinter 9P's class C notes and Bankinter 9T's class C notes' are capped at 'Asf', equivalent to the respective transaction account bank providers' (TAB) long-term deposit ratings (Societé Generale, S.A., 'A' for TDA 26-1 and TDA 26-2, Banco Santander S.A., 'A' for Bankinter 9P and Bankinter 9T). The rating cap reflects the excessive counterparty dependency on the TABs holding the cash reserves, as credit enhancement (CE) held at the TABs represents more than half of the CE available to the bonds, and the sudden loss of these funds would imply a downgrade of 10 or more notches in accordance with Fitch's criteria. CE Trends: For TDA 26-1, TDA 26-2 and Bankinter 9P, Fitch expects CE ratios to continue increasing on sequential amortisation of the notes and their non-amortising reserve funds. As the portfolio balance is now below 10% of its original balance, a mandatory sequential paydown of the liabilities will continue until the final maturity date in line with transactions' documentation. For Bankinter 9T, a switch to reverse pro-rata is unlikely as it is subject to the reserve fund being at its target amount and the portfolio balance is above 10% of its initial balance (currently at around 13.1%). However, if reverse sequential pro-rata amortisation was triggered, Fitch does not expect it to affect the current rating of the notes. ESG Governance: TDA 26-2 remains exposed to payment interruption risk (PIR) in the event of a servicer disruption, as Fitch deems the available cash reserve fund insufficient to cover stressed senior fees, net swap payments and senior note interest due amounts while an alternative servicer arrangement is being implemented. This assessment takes into consideration the very low borrower count left in the pool of around 254, which exposes the transaction to added volatility with a default of few borrowers as the cash reserve fund can also be used to cover credit losses. This leads to an ESG Relevance Score of '5' for Transaction & Collateral Structure due to PIR and a cap on the class A notes' rating at 'A+sf'. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: For Bankinter 9P's class A notes and class B notes, Bankinter 9T's class A and B notes, and for TDA 26-1´s class A notes, a downgrade to Spain's Long-Term Issuer Default Rating (IDR) that could lower the maximum achievable rating for Spanish structured finance transactions. This is because the class A and B notes are rated at 'AAAsf', the maximum achievable rating in Spain, six notches above the sovereign IDR. For Bankinter 9P's class C notes, Bankinter 9T's class C notes, TDA 26-1's class C notes and TDA 26-2's class B notes, a downgrade of their respective TABs' long-term deposit rating could trigger a corresponding downgrade of the notes. This is because the notes' ratings are capped at the TAB rating given the excessive counterparty risk exposure. A longer-than-expected economic downturn that erodes both macroeconomic fundamentals and the performance of the RMBS market in Spain beyond Fitch's current base case could result in downgrades of the notes. CE ratios unable to fully compensate the credit losses and cash flow stresses associated with the current ratings, all else being equal, will also result in downgrades. Fitch conducts sensitivity analyses by stressing both a transaction's base-case foreclosure frequency (FF) and recovery rate (RR) assumptions, and examining the rating implications for all classes of issued notes. A 15% increase in the weighted average (WA) FF and decrease in the WARR by 15 % would result in no more than one notch downgrade on Bankinter 9P class B notes. Factors that could, individually or collectively, lead to positive rating action/upgrade: Bankinter 9P's class A and class B notes, Bankinter 9T's class A and B notes and TDA 26-1 class A and B notes, are rated at the highest level on Fitch's scale and therefore cannot be upgraded. For Bankinter 9P's class C notes, Bankinter 9T's class C notes, TDA 26-1's class C notes and TDA 26-2's class B notes, an upgrade of their TABs' long-term deposit ratings could trigger a corresponding upgrade of the notes. Increases in CE ratios as the transactions deleverage to fully compensate the credit losses and cash flow stresses commensurate with higher ratings may result in upgrades. Fitch tested an additional rating sensitivity scenario by applying a decrease in the WAFF of 15% and an increase in the WARR of 15%. The results indicated no impact on the currently assigned ratings. DATA ADEQUACY Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pools and the transactions. Fitch has not reviewed the results of any third- party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. Fitch did not undertake a review of the information provided about the underlying asset pools ahead of the transactions' initial closing. The subsequent performance of the transactions over the years is consistent with the agency's expectations given the operating environment and Fitch is therefore satisfied that the asset pool information relied upon for its initial rating analysis was adequately reliable. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS TDA 26-1's class C notes, TDA 26-2's class B notes, Bankinter 9P's and 9T's class C notes' ratings are directly linked to their respective TABs' long-term deposit ratings due to excessive counterparty dependency. ESG CONSIDERATIONS TDA 26-2 has an ESG Relevance Score of '5' for Transaction & Collateral Structure due to unmitigated exposure to PIR which has a negative impact on the credit profile, is highly relevant to the rating and results in a lower rating than it would otherwise be. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. =========================== U N I T E D K I N G D O M =========================== AUTOVOGUE: Enters Liquidation, Owes Creditors GBP1.4 Million ------------------------------------------------------------ AM reports that liquidators have listed 61 creditors owed a combined total of GBP1.14 million after luxury used car retailer Autovogue slipped into liquidation this month. Documents filed with Companies House on March 26 showed that BCA Partner Finance was the main creditor of Staffordshire-based Autovogue, which ceased trading in February -- leaving a trail of dissatisfied customers, AM relates. The stock funding provider is owed over GBP635,000 and appears in a list alongside firms including the National Westminster Bank, HMRC and Micheldever Tyre Services in the list compiled by liquidators at Southampton-based Quantuma Advisory Limited, AM discloses. Back in February AM reported that Autovogue, which was founded by managing director Stuart Brown over 25 years ago, had ceased trading after blaming "failing used Jaguar Land Rover vehicles" for its faltering financial fortunes, AM recounts. The claim came as former customers of the retailer formed an "Autovogue AVR Victims" Facebook group to gather evidence of vehicles left with "finance markers" related to outstanding stocking loans, AM notes. A statement posted via the Autovogue website at the time apologised to customers and listed a number of reasons for the business's failure, AM relays. According to AM, it stated: "With deep regret and a heavy heart Autovogue UK Limited has ceased trading. "Unfortunately, in recent years and with the development of the global economy after COVID-19, further compounded by Ukraine and high UK inflation the automotive sector has been hit hard with significant pressures." Among the issues Autovogue claimed it had faced was a GBP198,000 repair cost for "huge additional costs and continuing issues with failing used Jaguar Land Rover vehicles". Autovogue's statement, as cited by AM, said that the business was co-operating fully with Leonard Curtis and its finance partner to "lift any finance markers still to be removed from some potential car finance agreements", adding: "This is the directors' primary concern in order to give stability, comfort and a solution for customers and in due course to be removed." BRIAN CLEGG: Owed GBP4 Million at Time of Administration -------------------------------------------------------- Jon Robinson at BusinessLive reports that almost GBP4 million was owed by a children's arts and crafts maker when it collapsed into administration last month, it has been revealed. Founded in 1973, Brian Clegg supplied both retail and educational markets across England and Wales and operated from one unit in Rochdale and another in Middleton. The company entered administration at the start of February, with the majority of its 36-strong headcount made redundant, BusinessLive recounts. According to BusinessLive, in a newly-filed document with Companies House, administrator FRP has detailed how much the business owed before it entered administration, the reasons behind its collapse and its subsequent purchase by a competitior. In February, the specialist business advisory firm said Brian Clegg had been "loss making for some time and suffered from sustained cashflow pressure from rising input prices", BusinessLive recounts. FRP, as cited by BusinessLive, said an "accelerated merger and acquisition process" had been conducted but, without a viable offer, the business was placed into administration. Teaser documents had been issued to over 340 potentially interested parties which resulted in 24 signed non-disclosure agreements, BusinessLive discloses. According to BusinessLive, a total of four formal offers were received to acquire the business and/or assets of the company. A sale was completed on March 3, BusinessLive states. In its new document, FRP, as cited by BusinessLive, said: "In the months leading up to the appointment of joint administrators, the business had experienced margin pressure as a result of increases raw material and utility costs. "This exacerbated cash pressures towards the end of December 2022 and was compounded by a reduced order book, in part by restricted budgets in the education sector." According to FRP, HSBCIF was owed GBP358,000 when Brian Clegg entered administration. The firm said HSBCIF had been repaid its principal debt but the account is being reviewed for final costs and charges, BusinessLive relays. HSBC was also owed GBP1.1 million, with the bank set to receive a distribution following the sale of property but FRP it is unclear if it will be repaid in full, BusinessLive discloses. CINEWORLD GROUP: CVC, Elliot Table Bid for Part of Business ----------------------------------------------------------- Oliver Barnes at The Financial Times reports that CVC Capital Partners and Elliott Management are among the suitors which have tabled bids for parts of Cineworld Group PLC, as the debt-saddled cinema chain plots an exit from bankruptcy proceedings. Buyout group CVC and hedge fund Elliott both made offers for Cineworld's Israeli and eastern European businesses, the FT relays, citing two people familiar with the matter. The bids were first reported by Sky News, the FT notes. Last month, Joshua Sussberg, a lawyer acting for Cineworld, told a US bankruptcy court in Texas that the struggling cinema operator had received "many offers" for its operations outside the US and the UK but only "some strategic interest" in its full business, the FT recounts. Cineworld -- which owns 128 cinemas in the UK under the Cineworld and Picturehouse brands and 511 cinemas in the US under the Regal brand -- also runs Cinema City across six countries in eastern Europe and Planet Cinema in Israel. Both CVC and Elliott have poured money into the leisure sector in recent years, the FT relays. CVC and Elliott did not table bids for Cineworld's US and UK operations, the chain's two biggest markets, the FT notes. Cineworld, which entered into Chapter 11 bankruptcy protection last September after crumbling under net debt and lease liabilities of US$8.8 billion, had previously said it was pushing for a sale of its whole business, the FT notes. But a person close to the bankruptcy process said: "It's not a stupid idea to think of selling off part of the business to reduce the amount of new capital required" when the "company emerges from bankruptcy in the coming months". The final bid deadline is set for next month. Lawyers for Cineworld and its secured lenders are pushing ahead with plans for a debt-for-equity swap as early as the end of May, which would give the creditors control of the business, the FT states. Cineworld previously said it expects the company's current shareholders to be wiped out in the bankruptcy proceedings, according to the FT. Cineworld's market capitalisation currently stands at just GBP35 million, the FT discloses. About Cineworld Group London-based Cineworld Group PLC was founded in 1995 and is the world's second-largest cinema chain. Cineworld operates 751 sites with 9,000 screens in 10 countries, including the Cineworld and Picturehouse screens in the UK and Ireland, Yes Planet in Israel, and Regal Cinemas in the United States. According to The Guardian, the Griedinger family, including Mooky's brother and deputy chief executive, Israel, have struggled to maintain control of the ailing business but have been forced to reduce their stake from 28% in recent years. Cineworld's top five investors include the Chinese Jangho Group at 13.8%, Polaris Capital Management (7.82%), Aberdeen Standard Investments (4.98%) and Aviva Investors (4.88%). The London-listed Cineworld, which has run up debt of more than $4.8 billion after losses soared during the pandemic, is pinning its hopes on a meatier slate of movies in 2022 to bounce back from a two-year lull. Cineworld Group plc and 104 affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 22-90168) on Sept. 7, 2022, estimating more than $1 billion in assets and debt. Judge Marvin Isgur oversees the cases. The Debtors tapped Kirkland & Ellis, LLP and Jackson Walker, LLP as bankruptcy counsels; PJT Partners, LP as investment banker; AlixPartners, LLP as restructuring advisor; and Ernst & Young, LLP as tax services provider. Kroll Restructuring Administration, LLC is the claims agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases on Sept. 23, 2022. The committee tapped Weil, Gotshal & Manges, LLP and Pachulski Stang Ziehl & Jones, LLP as legal counsels; FTI Consulting, Inc., as financial advisor; and Perella Weinberg Partners, LP as investment banker. FLYBE GROUP: Collapse Hits Cyrus Capital Hedge Fund --------------------------------------------------- Helen Cahill at The Times reports that the collapse of Flybe has delivered a hit of up to GBP70 million to entities linked with Lucien Farrell's Cyrus Capital hedge fund. The regional airline fell into administration for a second time in January after it struggled to reboot its operations amid delays in aircraft deliveries, The Times relates. It was rescued from its first insolvency by Cyrus Capital when a turnaround effort led by Virgin Atlantic fell apart in March 2020, The Times recounts. Flybe was officially transferred into a new operating company in April 2021 and received an equity injection of GBP20 million, as well as credit lines worth an initial GBP25 million, The Times discloses. However, its owners are now owed about GBP50 million after increasing their support for the business, The Times notes. SWADDLE MICRO: Enters Administration, Buyers Sought for Business ---------------------------------------------------------------- Alice Bird at Insider Media reports that a North Shields-based microbrewery has entered administration as a result of challenges in the sector including "sky-high utilities". Swaddle Micro Brewery Ltd was established in April 2017 and traded initially as a microbrewery with an on-site tap room at Royal Quays in North Shields. The business then expanded to open the Storm Cellar in Whitley Bay and the Black Storm Tap in Newcastle. Prior to the Covid-19 pandemic, the company generated a turnover of about GBP2.5 million, however lockdowns and restrictions "severely disrupted trading" and the two bars were closed to reduce losses, Insider Media discloses. Mark Ranson and Emma Mifsud of Opus Restructuring were appointed administrators on March 20, 2023, as further challenges hit the business, such as the cost-of-living crisis, Insider Media relates. According to Insider Media, in a statement on Black Storm Tap's website, founder Paul Hughes, said: "Unfortunately the journey has come to this point due to not being able to agree a course of action with our largest creditor HMRC, alongside the well documented issues within the brewing and hospitality industry, such as sky-high utilities and raw material costs, and the closure of a vast number of our trading partners, which we were not immune too." The company's five remaining staff were laid off as administrators were appointed, while debts are expected to be around GBP1.2 million, Insider Media notes. Agents Walker Singleton are now seeking interested parties for the business and assets, Insider Media states. Administrator Mark Ranson, as cited by Insider Media, said: "This is such a sad outcome for a well-respected business, which had such a bright future before the pandemic. We can only hope that any initial interest from potential buyers can be turned into an early sale of the business and assets to produce the best possible result for the creditors and to rescue the jobs put into jeopardy." ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2023. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. * * * End of Transmission * * *